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TESTIMONY 


FRANCIS    P.    KNIGHT 


OF    CHINA, 


BEFORE  THE  UNITED  STATES  SILVER  COMMISSION 
APPOINTED   BY  CONGRESS. 


January   1,  1877. 


BOSTON : 

ALBERT    J.    WinciIT,    STATE    PRINTER, 

79  Milk  Street  (cohner  of  Federal). 

1877. 


TESTIMONY 


CHINA. 

In  China,  the  only  government  coin  is  the  "  copper  cash,"  the 
medium  through  which  the  small  transactions  throughout  the  empire 
are,  for  the  most  part,  carried  on.  These  vary  in  value  ;  from  twelve 
to  eighteen  of  them  being  equal  to  an  American  cent,  according  to 
the  province  where  issued,  or  to  over  or  under  supply  in  any 
localit}' ;  their  value  in  silver  is  always  fluctuating.  These  copper 
coins  circulate  all  over  the  empire,  being  taken  by  count  in  payment 
of  small  sums,  and  bN-  weight  for  large.  They  are  made  in  strings 
of  assorted  issues  of  diflerent  reigns,  varying  in  size  and  quality, 
and  the  strings  usually  equal  the  value  of  one  "  tael "  weight  of 
pure  silver,  or,  in  some  localities,  of  that  of  a  Mexican  dollar. 
Their  value  by  weight  is  about  the  average  of  twelve  cents,  gold,  per 
pound. 

This  currenc}'  is  about  the  nearest  approach  to  our  "  legal  tender," 
and  in  mercantile  transactions  the  rate  at  which  it  shall  be  taken 
with  silver  or  gold,  or  as  compared  with  either,  is  a  matter  of  private 
contract.  This  coin  is  never  of  pure  copper,  but  alloyed  with  tin, 
zinc,  or  spelter,  and  debased  with  iron  and  sand.  The  purit}'  of 
different  issues  in  circulation  differs  to  a  great  degree ;  hence  the 
"  strings  "  are  made  up  of  all  sizes,  qualities  and  periods. 

Although  detection  is  punished  with  death,  the  "copper  cash"  is 
counterfeited  in  every  province. 

Debased  coins  have  been  issued  from  time  to  time,  either  when 
the  Imperial  Government  at  Peking  or  its  provincial  olHcials  became 
impoverished  b}'  a  long  war,  or  by  extensive  public  improvements, 
and  the  effect  of  this  debased  issue  was  similar  to  that  of  inflating  a 
currency  of  greenbacks, — panics  and  distress  being  the  inevitable 
final  result. 

Silver  and  gold  are  also  current  all  over  the  empire  itf  various 
forms,  their  value  being  regulated  by  the  laws  of  supply  and 
demand.  Silver,  being  the  universal  medium  of  the  countr}-, 
averages  in  value  rather  above  its  value  here,  compared  with  our 
gold  standard.  Foreign  coins  circulate  freely  in  the  districts 
adjoining  the  open  ports,  where  articles  of  export  are  produced. 


and  are .  generallj'  taken  by  weight.  At  Hong  Kong,  clean  {i.  e., 
unstamped)  Mexican  dollars  are  bought  b}'  the  native  traders  for 
coasting  voyages,  and  the  premium  is  governed  by  demand,  supply, 
etc.,  ranging  from  one  to  six  per  cent,  over  the  current  "  chopped  " 
or  stamped  dollar. 

It  is  the  custom  in  Hong  Kong  and  in  Canton  for  each  native 
banker  to  place  his  firm,  or  "  Hong"  stamp  on  all  the  dollars  which 
pass  through  his  hands  ;  hence  those  dollars  are  termed  by  foreigners 
and  by  the  English-speaking  natives,  not  "  stamped,"  but  in  the 
pigeon-English  dialect  common  in  China  where  foreigners  reside, 
"  chopped "  dollars.  A  manufacturer's  stamp  or  trademark  on 
cotton  goods  is  also  termed  his  "  chop."  The  reason  the  Chinese 
have  for  stamping  foreign  coins  is  partly  to  certify  that  when  such  a 
native  firm  (*'  Hong")  received  or  paid  out  the  coin,  it  was  by  them 
considered,  and,  as  it  were,  indorsed,  as  being  good.  As  may 
be  readily  imagined,  with  reference  to  the  stamped  or  so-called 
"  chopped  "  dollars,  the  placing  of  many  native  impressions  upon 
them  almost  obliterates  in  time  their  original  national  representation 
and  motto.  American  "  trade "  dollars  are  used  in  the  country 
near  Hong  Kong,  Macao,  Canton  and  Swatow,  by  count  for  small 
amounts,  b}?-  weight  for  large,  and  their  use  in  the  Canton  province 
has  been  officially  recognized  by  the  viceroy ;  but  very  few  indeed 
are  in  circulation  at  the  treaty  ports,  or  in  their  respective  provinces 
north  of  Foochow. 

Chopped  (stamped)  Mexican  dollars  are  current  in  Southern 
China,  and  are  weighed  at  the  weight  of  taels, — 717  per  $1,000. 
The  "  clean,"  that  is,  unstamped,  dollars  are  of  limited  local  circu- 
lation. In  the  tea  districts  around  Foochow  and  Amo}-,  broken  and 
battered  Ferdinand  and  Mexican  dollars  are  taken  by  weight  at 
taels,  720  per  $1,000  equivalent;  and  in  the  silk  districts,  in  the 
vicinity  of  Shangliai,  the  okl  "  Carolus,"  clean  (unstamped)  Mexi- 
can, and  a  few  clean  (unstamped)  trade  dollars  are  current.  The 
"  Carolus,"  sometimes  at  a  premium  above  the  local  "  tael "  (a 
weight  of  pure  silver)  and  the  Mexican  and  "  trade "  from  the 
par  of  720  taels  per  $1,000  to  five  per  cent,  premium  and  upwards, 
according  to  stock  and  demand. 

Foreign  coin,  in  fact,  at  its  first  introduction  passes  at  less  than 
its  actual  equivalent  in  "S3-cee"  (pure  silver),  but  when  the  people 
in  and  about  the  trading  centres  have  become  accustomed  to  it,  they 
are  willing  to  receive  it  at  a  premium.  Such  was  the  history  of  the 
old  S|)aiii.sh  pillar  dollar  coined  in  Mexico ;  such,  also,  the  history 
of  the  Mexican  dollar  ;  and  such,  possibly,  will  be  that  of  the  trade 
dollar.  At  the  present  time,  the  trade  dollar  would  probably  be 
taken   for  simply  its  value  as  bullion,  and  at  a  period  of  money 


pressure  it  would  be  worth  rather  less  than  the  same  amount  of  sil- 
ver in  the  shape  of  native  85^cee  ;  but  after  a  few  years — if  regularly 
supplied — it  would  be  worth  more  than  the  equivalent  quantit}^  of 
sycee.  A  coin  of  a  fixed  weight  and  quality  is  a  convenience,  and 
will  buy  more  than^  its  weight  in  bullion  after  the  sellers  in  the 
interior  have  become  accustomed  to  it  and  feel  confidence  that  its 
weight  and  quality  are  always  the  same. 

Bar  silver  in  its  original  shape  does  not  circulate,  but  is  bought 
by  native  bankers,  reraelted  into  the  form  of  native  "  shoes,"  stamped 
with  banker's  seal,  and  then  circulated  by  weight  only.  This  is 
known  as  "  sycee "  silver,  so-called  pure  silver,  the  value  being 
established  b}'  test,  agreement,  brand,  purity,  etc.,  all  of  which 
differ  in  various  sections  of  the  countr}'. 

Attached  to  every  custom-house  or  official  station  there  is  a 
government  bank  of  deposit,  or  sub-treasury,  where  duties  and 
taxes  are  deposited,  and  in  settling  these  a  premium  of  five  to  ten 
per  cent,  is  exacted  for  exchanging  local  silver  for  government  sil- 
ver, so  called,  although  the  greater  part  of  the  difference  is  fictitious. 

Silver  is  in  realit}'  the  standard  medium  of  the  empire,  principally 
in  the  form  of  "  shoes,"  but  taken  in  every  shape  b}'  weight  on  the 
native  basis.  The  money  scales  and  weights  vary  but  little,  and 
are  taels,  mace,  candareens,  and  cash  as  decimals,  calculated  thus : 
10  cash  =  1  candareen  ;  10  candareens  =  1  mace  ;  10  mace  =  1 
tael  =  -^^  of  1^  lbs.,  avoirdupois.  Accounts  are  kept  in  taels  or 
their  decimals,  and  although  iveights^  they  answer  all  the  purposes 
of  coin,  as  all  business  transactions  with  the  natives,  away  from 
the  small  circles  of  the  foreign  ports,  are  reduced  to  a  "  tael"  basis. 

The  average  value  in  sterling  has  usually  been  about  six  shillings 
per  tael,  and  the  equivalent  of  four  shillings  and  sixpence  for  a  clean 
Mexican  and  trade  dollar ;  but  this  year  there  has  been  a  range  of 
from  ten  to  twenty  per  cent,  fluctuation,  or  4s.  lid.  to  6s.  per 
Shanghai  tael. 

Gold  circulates  on  the  borders  of  India  and  Thibet  in  the  form  of 
small  bars  and  thin  leaves,  and  keeps  steadil}'  up  to  the  foreign 
value,  and  at  a  premium  when  in  demand  for  remittances  through 
disturbed  districts.  Large  shipments  have  been  made  to  India 
during  the  past  twelve  months  by  the  agents  in  Shanghai  of  the 
Bomba}'  opium  firms,  of  gold  received  at  the  northern  treat}'  ports 
of  Chefoo,  Tientsin  and  Newchwang. 

The  trade  and  consumption  of  Indiaia  opium  in  China  should 
occup}'  a  prominence  in  this  paper,  but  tne  trade  has  so  deviated  of 
late  from  its  old  course,  since  the  depreciation  of  silver  in  India, 
that  a  more  intimate  practical  knowledge  of  it  is  required  than  I 
possess  or  can  command  here.     The  dealers  at  the  different  treaty 


ports,  however,  have  often  been  forced  of  late  to  barter  their  drug 
for  produce,  to  sell  and  deliver  at  the  ports  against  native  drafts  on 
Shanghai  and  Hong  Kong,  and  to  participate  in  the  direct  trade 
between  China  and  London,  when  the}'  could  not  get  gold  in  return 
for  it  for  India.  But  as  the  rupee  regains  i^s  old  value,  the  drug 
will  be  moi-e  freely  disposed  of  for  sj'cee  (pure  silver),  most  of  which 
will  find  its  way  directly  to  the  Indian  mint.  The  increased  culti- 
vation of  opium  in  China  may  lessen  the  cost  of  the  Indian  article, 
but  no  diminution  of  the  imports  is  likely  to  take  place  for  years. 
The  value  of  the  trade  is  equal  to  about  $45,000,000  annually. 

Consumption  of  the  Precious  Metals. 

In  China,  with  a  population  of  some  three  hundred  and  fifty  mill- 
ions, and  in  India,  with  a  population  of  perhaps  two  hundred  and 
fifty  millions,  silver  furnishes  the  most  convenient  material  for  the 
ornaments  and  the  hoardings  of  the  great  bulk  of  the  people,  for 
the  simple  reason  that  it  bears  a  closer  relation  to  their  earnings 
and  their  possible  savings  than  does  gold. 

The  dollar  is  better  for  the  man  who  earns  two  dollars  a  month, 
than  the  eagle  or  the  double  eagle  would  be  ;  and,  for  this  reason,  I 
think  that  silver  will  for  a  long  while  continue  to  form  the  currency 
of  China  and  India,  and  to  be  used  for  ornaments  b}-  the  great 
body  of  the  population.  Here,  then,  we  have  about  one-third  of  the 
human  race  to  whom  silver  is  more  convenient  than  gold,  both  for 
ornament  and  for  currency,  and  it  would  be  of  great  interest  if  we 
could  make  any  estimate  of  the  quantities  of  the  metal  which  can 
be  absorbed  without  causing  any  marked  changes  in  the  prices  of 
other  articles,  or  in  other  words,  any  very  marked  decline  in  its  own 
value. 

Unfortunately,  however,  it  seems  impossible  to  come  to  any  solid 
opinion  upon  the  point,  a  fact  which  is  the  less  surprising  if  we 
consider  how  much  men  differ  as  to  the  effect  which  has  been  already 
produced  upon  the  value  of  gold  by  the  increased  production  of  the 
mines  of  America  and  Australia ;  some  believing  that  its  value  has 
fallen  very  greatly  (a  belief  which  the  present  mone}'  value  of  labor 
in  England  and  the  United  States  appears  to  authorize)  ;  while  others, 
maintaining  that  there  has  been  no  decline  whatsoever,  produce  in 
evidence  the  money  price  of  forty  different  articles.  If,  however, 
we  consider  how  great  the  tendency  has  been,  during  the  last 
twenty-five  3'ears,  to  a  reduction  in  prices,  owing  to  the  introduc- 
tion of  labor-saving  machinery,  it  would  appear  that  the  merely 
stationary  prices  of  forty  articles  rather  proved  that  the  production 
of  gold  had  very  seriously  enhanced  the  prices  which  would  other- 
wise have  obtained. 


Being  in  doubt,  then,  as  to  the  past,  we  can  hardly  with  an}-  very- 
great  confidence  indulge  in  conjectures  regarding  the  future  ;  but 
there  are  some  reasons  for  expecting  that  the  same  addition  to  the 
quantity  of  silver  in  the  world  will  produce  less  impression  upon  its 
price,  than  has  been  produced  upon  the  price  of  gold  by  the  mines 
of  California  and  Australia.  These  are  as  follows  :  First,  the  total 
value  of  all  the  silver  in  the  world  must  almost  necessarily  be  much 
greater  than  the  total  value  of  all  the  gold,  the  cheaper  metal  beino- 
within  the  means  of  attainment  of  a  vastly  greater  number  of  per- 
sons. From  this  we  should  infer  that  the  addition  of  a  hundred 
millions'  worth,  for  instance,  to  the  quantity  of  silver  in  the  world, 
would  produce  less  effect  upon  its  price  than  was  produced  by  the 
addition  of  a  hundred  millions'  worth  to  the  quantity  of  gold  in 
the  world.  Second,  the  tendency  of  gold  to  depreciate,  in  conse- 
quence of  its  greater  production,  has  been  supplemented  and  in- 
creased b}'  the  extension  of  the  use  of  paper  mone}-,  by  the  increase 
of  banks  of  discount  and  of  deposit,  by  the  use  of  clearing-houses 
and  of  telegraphs,  and  by  the  increased  facilities  for  the  transport 
of  materials, — all  of  which  causes  enable  a  given  amount  of  ex- 
changes to  be  effected  by  the  intervention  of  a  smaller  quantity  of 
gold,  and  none  of  which  are  likely,  during  the  next  quarter  of  a 
century,  to  come  into  action  in  the  countries  using  a  silver  currencj^ 
with  an  effect  at  all  comparable  to  that  which  they  have  had  in  the 
countries  which  use  gold  as  a  circulating  medium. 

In  the  countries  where  gold  is  used  as  a  measure  of  value,  we 
shall  of  course  see  the  quotations  of  silver  vary  considerabl}' ;  for 
while  it  must,  in  the  long  run,  be  maintained  in  the  East  at  a  price 
somewhat  above  its  price  in  London,  in  order  that  a  portion  of  the 
products  of  the  American  mines  ma}-  reach  that  part  of  the  globe, 
it  will  nevertheless  be  subject  to  occasional  temporary  fluctuations, 
whenever  the  balance  of  trade  compels  the  sending  back  of  silver 
to  Europe. 

It  costs  some  four  to  five  per  cent,  to  send  silver  from  London  to 
China,  and  an  equal  amount  to  send  it  back,  so  that  a  temporary 
reversal  of  the  usual  balance  of  trade  would  alone,  without  the  aid 
of  a  panic,  produce  a  difference  of  about  ten  per  cent.,  which  would 
appear  at  once  in  the  quotations  that  are  made  in  gold.  But  gold 
is  liable  to  similar  fluctuations,  for  ordinarily  and  in  the  long  run 
the  bialance  of  trade  must  be  such  as  to  allow  it  to  flow  out  of  the 
United  States  into  the  rest  of  the  world.  At  times,  however,  we 
see  the  current  reversed,  and  gold  coming  to  our  shores,  which 
shows  conclusively  that  for  the  moment  it  is  dearer  with  us  and 
cheaper  abroad,  contrary  to  the  normal  condition  of  things.  But 
gold  being  the  standard  of  values,  its  own  changes  or  fluctuations 


8 

of  value  are  not  perceived  in  the  same  way  that  we  perceive  similar 
fluctuations  in  the  value  of  silver. 

These  temporary  fluctuations,  both  in  gold  and  silver,  are,  how- 
ever, but  momentary  reversals  of  the  normal  currents  of  trade. 
They  give  us  no  information  as  to  the  general  rapidit}'  of  that  cur- 
rent, and  they  throw  no  light  whatever  upon  the  question,  whether 
the  one  metal  or  the  other  is  increasing  or  diminishing  in  value 
throughout  the  entire  world. 

There  are  some  who  greatl}'  fear  an  over-production  of  silver ; 
but  if,  during  the  next  quarter  of  a  centur}',  the  population  and 
wealth  of  the  world  increase  rapidly,  the  entire  production  of  this 
metal  may  be  absorbed  without  an}'  depreciation  whatsoever ;  and 
although  so  great  an  increase  of  wealth  and  population  appears 
improbable,  it  does  not  seem  at  all  unlikely  that  there  ma}'  be  an 
improvement  quite  sufficient  to  keep  silver,  during  the  next  twenty- 
five  years,  as  near  its  present  value  as  gold  has  kept  during  the  last 
twenty-five. 

I  mean  that  it  does  not  seem  extravagant  to  expect  the  actual 
change  of  value  to  be  no  greater.  The  apparent  change  will,  per- 
haps, be  more  distinct,  because  there  is  not  likely  to  occur  in  the 
East  a  mechanical  development  at  all  comparable  to  that  which  may 
have  masked  the  decline  of  gold  in  the  Western  World  since  1850. 

But  it  is  not  by  any  means  certain  that  even  the  apparent  changes 
will  be  greater,  for  China  is  rapidly  recovering  from  that  enormous 
loss  of  population  which  was  caused  by  the  terrible  rebellion  of  1852- 
1864,  and,  in  the  West,  our  own  country  will  probably  add  some 
forty  millions  to  the  members  of  the  most  commercial  and  wealthy 
portion  of  mankind,  and  will  require  an  immense  amount  of  silver 
for  plate,  etc.,  and  a  considerable  quantity  for  the  small  currency. 

While,  however,  no  absolute  answer  can  be  given  to  the  question 
as  to  what  may  be  the  consumption  and  employment  of  the  precious 
metals  in  China,  every  one  who  has  lived  there  and  has  observed  the 
great  use  of  silver  ornaments  by  the  bulk  of  the  people,  and  who, 
moreover,  reflects  upon  the  fact  that  scarcely  any  other  recipient  of 
savings  exists  for  the  millions,  must  perceive  that  silver  constitutes 
a  much  greater  proportion  of  the  capital  of  that  nation,  and  doubt- 
less of  India  also,  than  it  or  gold  does  of  the  capital  of  Europe  and 
America,  and  it  becomes  somewhat  difficult  to  resist  the  conviction 
that  silver,  under  the  same  circumstances  as  to  increased  production, 
would  prove  to  have  a  more  stable  value  than  gold. 

Adam  Smith  estimates  the  production  of  gold  and  silver  of  the 
American  mines  at  six  millions  sterling  per  annum,  and  concludes 
that  in  the  ninety  years  extending  from  1545  to  1636,  this  produc- 
tion had  reduced  the  value  of  silver  to  one-third  or  one-fourth  of  its 


9 

value  at  the  first-named  date,  so  that  it  required  from  three  to  four 
times  as  much  silver  to  pay  for  a  (juarter  of  wheat  at  the  close  of  the 
period  cited.  But  the  advances  which  are  now  being  made  in  wealth 
and  in  population  so  many  times  exceed  those  made  during  the  six- 
teenth and  seventeenth  centuries,  and  the  capital  now  existing,  also, 
so  greatly  exceeds  that  which  existed  at  the  earlier  period,  that  we 
cannot  expect  a  similar  decline  in  value  to  occur  now,  unless  the 
annual  production  should  be  several  times  greater. 

Exchange,  Foreign. 

The  course  of  foreign  exchanges  may  be  briefly  stated  to  exist 
between  the  China  ports  and  London  onl3\  There  is  a  fictitious,  or 
apparent,  course  of  exchange  between  China  and  New  York  or  San 
Francisco,  but  it  is  only  with  those  points  as  halting-places,  being 
even  then  really  on  London,  and  the  rate  always  based  upon  that 
existing  in  London. 

This  will  be  readily  understood  by  those  who  are  at  all  conversant 
with  the  business,  since  British  capital  carries  on  the  whole  China 
trade.  There  can  be  no  change  until  that  fact  is  changed,  and  until 
rates  of  interest  equalize.  Rates  of  exchange  follow  the  value  of 
silver  in  London,  being  based  upon  the  cost  of  remittances  of  that 
metal  to  China,  except  in  cases  where  the  silver  supply  falls  short, 
or  such  otlier  exceptional  causes  as  affect  merchandise. 

Bills  on  London  are  negotiated  through  the  local  foreign  banks, 
and  the  agencies  of  London  banks,  as  well  as  through  foreign 
merchants.  At  Shanghai,  bills  on  London  at  six  months'  sight  are 
drawn  for  the  equivalent  of  taels,  the  rate  varying  the  past  year 
from  5s.  to  6s.  per  tael.  At  Hong  Kong  and  other  China  ports,  as 
well  as  at  Japan,  bills  are  drawn  at  six  months'  sight  for  equivalent 
of  Mexican  dollars,  and  the  rate  has  varied  from  3s.  Qd.  to  4s.  6d. 
per  dollar.  li'or  man}'  years  previous  the  rates  have  usually  been 
from  5s.  8d.  to  6s.  6d.  per  tael,  and  4s.  4d.  to  4s.  6d.  per  dollar. 

Internal  Exchange,  Native, 
Is  negotiated  through  individual  merchants  and  private  bankers, 
rates  being  regulated  by  distance,  time,  risk,  etc. ;    but  silver  and 
gold  can  generally  be  shipped,  and  are  so  shipped,  as  favorably  as 
drafts  can  be  bought. 

Banking. 
Foreign  banks  are  established  at  most  of  the  open  ports,  and  do 
a  general  banking  business  ;  but  the  circulation  of  their  notes  is 
merely  local.     Rate  of  interest  ten  to  twelve  per  cent,  per  annum. 
2 


10 

Native  banks  exist  in  ever}'  town  and  city,  and  their  business 
corresponds  to  that  of  our  bankers,  although  resmelting  is  a  branch. 
Rate  of  interest  is  a  matter  of  agreement,  rai'el}'  below  twelve  per 
cent,  per  annum,  and  sometimes  as  high  as  three  per  cent,  per 
month  upon  short  loans.  In  some  parts  of  China  paper  notes  are 
issued  by  bankers,  merchants,  and  even  innkeepers,  for  small 
amounts  and  local  convenience,  without  much  profit,  however,  to 
the  issuer.  Of  the  legal-tender  laws  of  China  I  have  no  reliable 
information. 

Pawnbkoking. 

Pawnbrokers  are  everywhere  established  under  government 
license,  restriction,  and  protection,  and  are  of  great  service  to 
small  traders  and  laborers.*  Rate  of  interest,  twelve  per  cent,  per 
annum.  The  government  banks  are  merely  for  deposit,  and  certifi- 
cates are  issued  showing  that  duties,  etc.,  have  been  paid  to  the 
amount  specified  on  their  face  ;  but  being  usually  deposited  imme- 
diately at  the  custom-house,  they  are  only  a  convenience,  and  have 
no  circulation.  China  is,  without  doubt,  a  "  hard  mone}' "  country, 
silver  being  the  medium,  and  paper  currency  of  all  kinds  is  every- 
where looked  upon  with  suspicion,  and  rules  at  a  discount.  Their 
ideas  of  all  coined  mone^'  of  foreign  denominations,  and  even  of 
foreign  ingot  gold  and  silver,  are  extremely  whimsical. 

A  Chinese  Mint  Proposed. 

Since  writing  the  above,  information  has  reached  me  that  it  is  the 
intention  of  the  Chinese  government  to  establish  a  mint,  and  this 
fact  is  one  of  great  importance  to  all  those  who  are  interested  in  the 
subjects  upon  which  this  paper  treats.  I  apprehend  that  the  result 
will  be  to  reduce,  and  finally  altogether  abolish,  the  use  of  foreign 
coins,  but  to  increase  the  demand  for,  and  employment  of,  silver 
bullion  in  that  empire. 

That  the  new  coins  of  the  realm  will  be  received  at  once  into  cir- 
culation there  can  be  no  question,  for  the  few  copper  "  cash  "  and 
small  silver  coins  which  were  fabricated  for  two  years  in  the  British 
colony  of  Hong  Kong,  are  yet  freely  received  for  small  payments  in 
Hong  Kong  and  Canton,  and  it  is  reasonable  to  expect  that  a  native 
government  coin  will  have  a  far  better  experience  than  a  foreign 
coin.  One  of  England's  greatest  mistakes,  I  may  here  remark  by 
way  of  parenthesis,  in  her  Eastern  polic}',  was  to  allow  their  mint  in 
Hong  Kong  to  be  sold  and  transfewed  to  Japan,  because  it  brought 
no  immediate  profit.  The  Chinese  government,  however,  will  not 
put  out  their  new  coins  without  previous  assuring  official  announce. 


11 

ments  and  edicts  ;  and  when  once  the  government  receives  its  own 
coins  in  payments  of  duties,  no  difficulties  will  follow. 

That  the  establishment  of  a  mint  in  China  will  increase  the  de- 
mand for  bullion  in  that  empire,  may,  I  think,  be  demonstrated  with 
equal  ease.  It  is  probable  that  the  government,  having  established 
its  own  standard  "  touch"  of  silver,  will  issue  coins  representing  in 
value  the  old  decimal  weight  currency  of  the  country,  and  recog- 
nized as  a  tael,  a  mace,  and  a  candareen,  besides  some  new  and 
improved  copper  "  cash  "  coins  or  tokens  ;  and  if  they  do  so,  these 
small,  convenient  coins — a  convenience  entirely  new  to  the  Chinese 
nation — will  obviate  the  necessity,  to  the  millions  of  the  poorer 
classes,  of  carr3'ing  about  upon  their  persons  the  heavy,  incon- 
venient strings  of  copper  "  cash  "  with  which  they  have  always  been 
burdened.  Small  silver  coins  will  take  their  place,  with  the  excep- 
tion of  the  few  "  cash  "  required  for  the  Chinaman's  trifling  daily 
expenses,  and  this  continued  increase  of  demand  for  silver  will  take 
place,  I  think,  for  years  to  come. 

Of  the  benefits  which  must  accrue  to  China,  morally  and  commer- 
cially, by  the  establishment  of  a  government  mint,  jio  mention  need 
be  made  here,  but  it  is  safe  to  say  that  they  are  incalculable.    . 


UC  SOUTHERN  REGIONAL  LIBRARY  FACILITY 


AA    001  120  611 


CENTRAL  UNIVERSITY  LIBRARY 
University  of  California,  Saji  Diego 


DATE  DUE 


UUI  17  1978 


UCSD  Libf. 


